B-124826, AUG. 10, 1955

B-124826, AUG. 10, 1955

TO SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED JULY 22, 1955, FROM THE DEPUTY ASSISTANT SECRETARY (LOGISTICS AND R AND D), WITH ENCLOSURES, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN WITH RESPECT TO AN ERROR ALLEGED BY R. F. BALL CONSTRUCTION COMPANY, SAN ANTONIO, TEXAS, TO HAVE BEEN MADE IN ITS BID FOR CONSTRUCTION WORK AT TINKER AIR FORCE BASE, OKLAHOMA CITY, OKLAHOMA, SUBMITTED IN RESPONSE TO INVITATION FOR BIDS NO. ENG-34-066-55- 63 ISSUED BY THE DISTRICT ENGINEER, TULSA, OKLAHOMA, UNDER DATE OF FEBRUARY 18, 1955. THE BID WAS ACCEPTED AND BECAME THE BASIS OF CONTRACT NO. DA-34-066-ENG-4712.

THE INVITATION INCLUDED TWO UNIT PRICE SCHEDULES, BIDDERS BEING INVITED TO BID ON EITHER OR BOTH SCHEDULES. IN ACCORDANCE WITH THE INVITATION, BIDS WERE PUBLICLY OPENED AT 2 P.M. ON MARCH 23, 1955, AT TULSA, OKLAHOMA. EIGHT BIDS WERE RECEIVED, RANGING FROM $1,351,259 TO $1,750,000 ON ITEM NO. 1 OF SCHEDULE 1 AND FROM $740,915 TO $895,000 ON ITEM NO. 1 OF SCHEDULE 2. R.F. BALL CONSTRUCTION COMPANY WAS LOW BIDDER ON EACH SCHEDULE, THE NEXT LOW BIDS ON THE TWO SCHEDULES BEING $1,460,611 AND $780,000, RESPECTIVELY.

IT IS REPORTED THAT THE AWARD WAS MADE TO R. F. BALL CONSTRUCTION COMPANY AS LOW BIDDER ON MARCH 24, 1955, AND THAT NOTICE OF THE AWARD WAS DEPOSITED IN THE MAILS AT APPROXIMATELY 9 A.M. ON MARCH 25, 1955, ALTHOUGH THE POSTMARK OF THE TULSA POST OFFICE ON THE ENVELOPE USED IN TRANSMITTING THE NOTICE OF AWARD IS DATED MARCH 25, 1955, AT 5:30 P.M. THE CONTRACTOR STATES IN ITS LETTER OF APRIL 4, 1955, THAT IT RECEIVED THE NOTICE OF AWARD ON MARCH 28, 1955. BY A TELEPHONE CALL ON MARCH 25, 1955 (STATED BY THE CONTRACTOR TO HAVE BEEN MADE AT 8:40 A.M. AND STATED BY THE CONTRACTING OFFICER TO HAVE BEEN MADE AT 11 A.M.), THE CONTRACTOR ALLEGED AN ERROR OF $67,716 IN ITS BID, WHICH IT CONFIRMED BY TELEGRAM AND LETTER OF MARCH 25, 1955. BY LETTER DATED APRIL 14,1955, THE CONTRACTOR REDUCED ITS CLAIM FOR ADJUSTMENT FROM $67,716 TO $60,543.38. THE ERROR WAS ALLEGED BY THE CONTRACTOR TO HAVE RESULTED FROM "OUR FAILURE TO CARRY FORWARD TO OUR SUMMARY SHEETS AND TO INCLUDE IN OUR TOTAL, A LARGE PORTION OF OUR ELECTRICAL WORK.'

IT APPEARS THAT ARRANGEMENTS HAD BEEN MADE FOR A PREAWARD CONFERENCE BETWEEN THE CONTRACTING OFFICER AND REPRESENTATIVES OF R. F. BALL CONSTRUCTION COMPANY TO BE HELD ON MONDAY MARCH 28, 1955, BUT THAT SUCH CONFERENCE WAS DETERMINED BY THE CONTRACTING OFFICER TO BE UNNECESSARY AND THE AWARD WAS MADE ON MARCH 24. IN ITS LETTER OF APRIL 4, 1955, THE CONTRACTOR STATES THAT ON MARCH 28, 1955, ITS REPRESENTATIVES MET WITH REPRESENTATIVES OF THE DISTRICT ENGINEER, DELIVERED TO THEM THE COMPLETE ORIGINAL WORK PAPERS AND EXPLAINED HOW THE ERROR IN BID OCCURRED. IN HIS FINDINGS OF FACT THE CONTRACTING OFFICER STATES "INSOFAR AS THIS OFFICE CAN DETERMINE, THE ALLEGED MISTAKE IN BID DID OCCUR.' HE STATES ALSO THAT IN THE COURSE OF THE TELEPHONE CONVERSATION ON MARCH 25 THE CONTRACTOR WAS ADVISED THAT "IN THE EVENT THE CONTRACT AWARD HAD NOT YET BEEN ENTERED IN THE RECORDS OF THE TULSA DISTRICT, NOR THE CONTRACTUAL INSTRUMENT ITSELF PLACED IN THE MAILS, FORMAL AWARD WOULD BE HELD IN ABEYANCE PENDING FURTHER INQUIRY INTO THE ALLEGATIONS OF MISTAKE IN BID.'

THE GENERAL RULE IS THAT PROPOSALS THAT HAVE BEEN SUBMITTED IN RESPONSE TO AN ADVERTISEMENT FOR BIDS MAY NOT BE WITHDRAWN AFTER THEY HAVE BEEN OPENED EVEN BEFORE AWARD IS MADE AND THAT THE BIDDER IS BOUND TO ACCEPT THE AWARD. 19 COMP. GEN. 761 AND AUTHORITIES THEREIN CITED. SEE, ALSO, SCOTT V. UNITED STATES, 44 C.CLS. 54. HOWEVER, COURT DECISIONS HAVE ALLOWED ADDITIONAL COMPENSATIONS TO LOW BID CONTRACTORS WHO, THOUGH REFUSED PERMISSION ADMINISTRATIVELY TO CORRECT THEIR BIDS, HAVE BEEN ABLE TO PRESENT SATISFACTORY PROOF THAT THEIR BIDS WERE ERRONEOUS, TOGETHER WITH A CLEAR SHOWING AS TO WHAT THEY INTENDED TO BID. EDMUND J. RAPPOLI COMPANY INC. V. UNITED STATES, 98 C. CLS. 499. IN THE INSTANT MATTER, THERE APPEARS TO BE LITTLE, IF ANY, DOUBT THAT THE BID WAS ERRONEOUS AND THAT THE CONTRACTOR INTENDED TO BID $60,543.38 MORE THAN THE CONTRACT PRICE. IF SUCH ADDITIONAL AMOUNT IS ADDED TO THE CONTRACT PRICE IT WILL STILL BE SUBSTANTIALLY LOWER THAN THE NEXT LOW BID.

IF OF IMPORTANCE, IT SEEMS DOUBTFUL WHETHER THE AWARD MADE ON MARCH 24 WAS EFFECTIVE UNTIL RECEIVED BY THE CONTRACTOR ON MARCH 28. SEE RHODE ISLAND TOOL COMPANY V. UNITED STATES, NO. 49913, DECIDED BY THE COURT OF CLAIMS FEBRUARY 8, 1955, REFERRED TO IN FIRST INDORSEMENT OF JUNE 20, 1955, FROM THE DIVISION ENGINEER, DALLAS, TEXAS.

IN VIEW OF THE FOREGOING, THE CONTRACT MAY BE MODIFIED SO AS TO PERMIT PAYMENT OF AN ADDITIONAL AMOUNT OF $60,543.38 TO THE CONTRACTOR. REFERENCE TO THIS DECISION SHOULD ACCOMPANY THE CONTRACT.

THE PAPERS ARE RETURNED HEREWITH, WITH THE EXCEPTION OF ONE COPY EACH OF THE CONTRACTING OFFICER'S STATEMENT OF FACTS, THE INVITATION FOR BIDS, THE ABSTRACT OF BIDS AND THE CONTRACTOR'S TELEGRAM AND ATTACHED PAPERS RELATIVE TO ITS ALLEGATION OF ERROR.